As Health Insurance Rates Increase, Small Businesses Face Tough Choices
[7/19/07]
The cost of health insurance premiums continue to rise and perhaps the impact is being felt most by small businesses. Today across the nation many a small business owner is faced with the often difficult decision to reduce or eliminate group health insurance benefits for their employees. Contrary to what you might think a large portion of the swelling ranks of the uninsured in this country is made up of people who are working. They just happen to be working for companies who can no longer afford to provide health insurance benefits due to increased costs.
Over the past few years small businesses have had to deal with group health insurance premiums that have increased by as much as 20% or more in some states. They have had to either cut benefits, or ask their employees to dig deeper into their own pockets to help share the burden. AS debate rages across the nation on health insurance and healthcare reform many experts agree that the problems of small businesses are likely to be at the heart of it.
In Colorado for example a commission has been set up to work directly with small business associations such as the National Federation of Independent Business (NFIB) to seek solutions to easing the burden of health insurance costs for small businesses. According to a recent survey conducted by the NFIB, almost 75% of their members stated that access to low cost group health insurance was their number one concern.
Small businesses especially in states like Colorado become almost like families, with owners growing very close to their small staffs. Business owners then wind up facing some very tough choices according to local economists. Do they cut health benefits? Cut other benefits like pay or vacation? Or make their employees pay more for health insurance coverage. One company in Fort Collins, A-Train Marketing, while they say they cannot afford a group health insurance plan because it is just prohibitively expensive, provides each of its employees with a $150.00 a month stipend to purchase their own private health insurance. “It’s not much but it shows we care about our employees…” says the company’s owner.
Even companies that do try to offer their workers medical benefits, often the prices are so high for the employee’s contribution that few workers take advantage of them, and remain uninsured. For small companies as health insurance premiums increase more and more is shifted to workers. A small business can pay as much as 30% more than a large business with more ability to pool risk.
In a state like Colorado where small business accounts for two thirds of the non-farm jobs, it is essential that the legislature and the federal governments step up to support small business when it comes to healthcare. Officials with the State and with organizations such as NFIB agree that a good part of the solution is to offer tax breaks and incentives to small business that offer health insurance, which will allow them to be more competitive in the health insurance marketplace.
Over the past few years small businesses have had to deal with group health insurance premiums that have increased by as much as 20% or more in some states. They have had to either cut benefits, or ask their employees to dig deeper into their own pockets to help share the burden. AS debate rages across the nation on health insurance and healthcare reform many experts agree that the problems of small businesses are likely to be at the heart of it.
In Colorado for example a commission has been set up to work directly with small business associations such as the National Federation of Independent Business (NFIB) to seek solutions to easing the burden of health insurance costs for small businesses. According to a recent survey conducted by the NFIB, almost 75% of their members stated that access to low cost group health insurance was their number one concern.
Small businesses especially in states like Colorado become almost like families, with owners growing very close to their small staffs. Business owners then wind up facing some very tough choices according to local economists. Do they cut health benefits? Cut other benefits like pay or vacation? Or make their employees pay more for health insurance coverage. One company in Fort Collins, A-Train Marketing, while they say they cannot afford a group health insurance plan because it is just prohibitively expensive, provides each of its employees with a $150.00 a month stipend to purchase their own private health insurance. “It’s not much but it shows we care about our employees…” says the company’s owner.
Even companies that do try to offer their workers medical benefits, often the prices are so high for the employee’s contribution that few workers take advantage of them, and remain uninsured. For small companies as health insurance premiums increase more and more is shifted to workers. A small business can pay as much as 30% more than a large business with more ability to pool risk.
In a state like Colorado where small business accounts for two thirds of the non-farm jobs, it is essential that the legislature and the federal governments step up to support small business when it comes to healthcare. Officials with the State and with organizations such as NFIB agree that a good part of the solution is to offer tax breaks and incentives to small business that offer health insurance, which will allow them to be more competitive in the health insurance marketplace.
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